Discrimination Victims Deserve REAL Justice

The EEOC has asked for public input so here goes:

Why is the EEOC operating the equivalent of a “get out of jail free card” for employers that engage in employment discrimination and retaliation?

When the EEOC determines there is reasonable cause for a charge of discrimination, the agency offers the employer (and the victim) the opportunity to participate in its free mediation program, where a neutral mediator assists the parties in reaching an early and confidential  resolution to a charge of discrimination.

In its 2014 performance report, the EEOC contends the mediation program is a “win for both Employees and Employers” but in the final analysis it is a much bigger win for employers.

The EEOC says its mediation program for private sector complainants  achieved a resolution in 7,846 out of a total of 10,221 mediations conducted for all types of discrimination.  The effort yielded $144.6 million in monetary benefits for complainants. Simple division indicates the EEOC’s mediation effort yielded $18,430 per mediation for private sector workers in 2014.

A payout of less than $20,000 per mediation is a bona fide windfall for employers, who might otherwise be forced to spend a hundred thousands dollars or more to defend a lawsuit, plus a potentially staggering damages award.

But $20,000 is a pittance at best for many – if not most – victims of employment discrimination – especially those who lost their jobs or who were not hired because of illegal discrimination.

There’s the rub

The EEOC is not supposed to be in the business of protecting discriminatory employers from the reasonable consequences of their harmful actions. [Read more…]

Appeals Court Puts Judge on Hot Seat in Trucking Case

The U.S. Court of Appeals for the 8th Circuit has rejected an order requiring the EEOC to pay $4.7 million in attorney fees and costs  to CRST Van Expedited, Inc., one of the nation’s leading transport companies, in an egregious sexual harassment case involving female truck driver trainees.

This lawsuit, perhaps more than any other in recent history, demonstrates the extent to which federal courts have moved away from the worthy goal of addressing serious employment discrimination to engaging in pro-business partisanship, sweeping generalizations and moronic procedural disputes.  It also raises questions about whether the EEOC, in the current environment, can actually carry out its goal of promoting  more strategic use of agency resources by emphasizing high stakes litigation involving multiple victims.

At various points, Chief Judge Linda R. Reade of the U.S. District Court of Iowa dismissed all of the 154 plaintiffs in the EEOC case and  ruled the agency  must pay CRST, one of the nation’s leading transport company, a whopping $4.7 million in attorneys’ fees and costs.

The 8th Circuit’s ruling constitutes a step in the right direction. The appeals court remanded the case back to the district court with instructions to reassess the attorney’s fee award. Among other things, the appeals court is asking Reade to explain why she dismissed dozens of sexual harassment claims as frivolous, unreasonable or ungrounded.  Moreover, the Court rejected Reade’s award of attorney fees with respect to 67 claimants whom Reade dismissed from the case under a controversial ‘failure to conciliate” theory.

Several federal circuits have ruled the EEOC must engage in individual conciliation or negotiations with an employer with respect to each and every claim in a class action lawsuit, even if the employer has indicated no willingness to settle.  This requirement allows guilty employers to delay adjudicting the issue of discrimination, constitutes a colossal waste of  EEOC resources, and ultimately severely limits the agency’s ability to file class action employment discrimination lawsuits.

Reade dismissed  67 potential class members from the CRST lawsuit on the grounds that the EEOC failed to engage in  “bona fide” conciliation efforts with CRST. She did not even consider the merits of the plaintiff’s claims, some of which involved shocking allegations of sexual harassment and abuse lodged by female truck driver trainees who were stranded in isolated conditions on the road.  These women alleged that CRST did little or nothing in response to their complaints.

The 8th Circuit ruled that the EEOC’s duty to conciliate does not constitute an element of a claim. Therefore, the appeals court said , the EEOC didn’t lose those 67 claims and the CRST was not a prevailing party with respect to those claims.  The appeals court concluded that CRST is not entitled to an award of attorneys’ fees for the claims dismissed under the “failure to conciliate” theory.

[Read more…]

Company Liable for Lovestruck HR Director

A federal appeals court in Puerto Rico has rejected the narrow limitations imposed by the U.S. Supreme Court on who is considered to be a “supervisor” in employment discrimination cases.

The U.S. Court of Appeals for the First Circuit held that Developers Diversified Realty Corp (DDR) can be held liable for sexual harassment by Rosa Martinez, an HR officer for the company, who engineered the ouster of Antonio Velázquez-Pérez, a company regional general manager, after he rebuffed her advances.

Both Martinez and Velázquez worked in the Puerto Rico offices of DDR, a shopping center management company based in Ohio.

In its ruling , the appeals court acknowledged that the U.S. Supreme Court last year limited employer liability under Title VII of the Civil Rights Act in cases where a non-supervisor causes a discriminatory action. Martinez was not Velázquez’ supervisor.  However, the 1st Circuit court said, DDR should have known that Martinez’s recommendation that Velázquez be fired was the product of discriminatory animus and therefore can be held liable under Title VII for negligently allowing Martinez to cause Velázquez’s termination.

Noting the case presented issues that it had not addressed previously. the appeals court concluded that an employer can be held liable if  the co-worker acted for discriminatory reasons with the intent to cause the plaintiff’s firing; the co-worker’s actions were in fact the proximate cause of the termination; and the employer allowed the co-worker’s acts to achieve their desired effect though it knew (or reasonably should have known) of the discriminatory motivation.

The Court reversed the district court’s grant of summary judgment on Velázquez’s claim of sexual discrimination in violation of Title VII.

According the  opinion, Velázquez and Martinez had mutually flirted with each other when they both went to a company meeting in April 2008 and stayed at the same hotel. That night, Velázquez was walking with two female employees of the company when Martinez appeared in their path and asked where they were going.  Martinez followed Velázquez to his room,  tried to force her way in and refused to leave until Velázquez threatened to call security.  She then telephoned hm several times and sent a jealous email to one of the women that he had been walking with.  Shortly thereafter, Martinez threatened to have Velázquez fired, stating, “I don’t have to take revenge on anyone; if somebody knows your professional weaknesses, that person is me.”

Velázquez complained about Martinez’s behavior to his supervisor, who advised him to send her a “conciliatory” email because “[s]he’s going to get you terminated.” He and another male employee then jokingly suggested that Velázquez have sex with Martinez.

Martinez began a campaign of harsh criticism of Velázquez’s work, culminating with a recommendation that he be terminated. The top company official in Puerto Rico suggested that instead of termination Velázquez be issued a formal warning and placed on a Performance Improvement Plan.  Martinez went over his head and complained to two senior officials at the company’s headquarters in Ohio.

Meanwhile, Velázquez and Martinez went to another business meeting and stayed at the same hotel.  This time Martinez followed Velázquez into an elevator and said  she loved him and “wanted to have a romantic relationship with him.” Velázquez refused. That night, Martinez sent an email to the Ohio officials recommending that Velázquez be terminated immediately “because his behavior has been against the company code of conduct and has already impacted the trust form other team members.”

Four days later, on August 25, 2008, Velázquez was terminated for “[a]bsenteeism,” “[f]ailure to report,” and “[u]nsatisfactory performance.”

Tap on Wrist for ‘Egregious’ Sexual Harassment

Ct Slashes Jury’s Punitive Award

A decision by the U.S. Court of Appeals for the Ninth Circuit  this week raises questions about  the way courts calculate damage awards in discrimination cases.

A three-judge panel of the San Francisco-based court reduced what started out as a $868,750 jury award for punitive damages in a sexual harassment case to $125,000.

The defendant is the American Smelting and Refining Company (ASARCO),  a Sahuarita, Arizona company owned by Grupo Mexico Corp. that is the third largest copper producer in the US, with estimated earnings in excess of $800 million.

The appeals court agreed that ASARCO employee Angela Aguilar was the victim of “particularly egregious” sexual harassment while working for ASARCO from December 19, 2005 to November 8, 2006.  However, the court said it was required to lower the award because the ratio of punitive damages was excessive compared to the $1 the jury awarded Aguilar for compensatory damages .

Punitive damages are supposed to deter the defendant from engaging in future similar conduct. In other words, the punitive damages should be significant enough to get an employer’s attention so that it will change the illegal practices that led to the damages in the first place.   Will a $125,000 punitive damage award compel a billion dollar corporation to eliminate serious  sexual harassment at the Arizona plant? Not likely.

Statutory cap

The jury’s original punitive damage award was actually hit with a double whammy.

The lower court immediately reduced the $868,750 punitive damage assessment to $300,000 pursuant to a statutory cap placed on such awards by the U.S. Congress.  However, the  lower court refused to further reduce the punitive damage award because of the egregious nature of the harassment suffered by Aguilar.  ASARCO had argued the award should be reduced to $2,500.

The appeals court agreed that ASARCO’s conduct supported  a “very large punitive award” but said the U.S. Supreme Court ruled in 1996 that punitive damages must bear a “reasonable relationship”  to compensatory damages under the due process clause of the U.S. Constitution.  If left to stand, the appeals court said, the ratio of $300,000 in punitive damages to $1 in compensatory damages would be among the highest (if not the highest) ratio since 1996.

“The Supreme Court has repeatedly emphasized the importance of the ratio inquiry and we cannot set it aside … [W]e conclude that the highest punitive award supportable under due process is $125,000, in accord with the highest ratio we could locate among discrimination cases.”

One member of the three-judge appellate panel, Judge Andrew D. Hurwitz, issued a partial concurrence/dissent, arguing the court should affirm the earlier $300,000 judgment because it fell within the statutory cap on damages in Title VII cases.

The Harassment

Here’s a very abbreviated account of what Aguilar experienced while working  at ASARCO:

  • Her supervisor, a very large man, asked her out every day and refused to train her or help her when she rejected him. When she asked for help, he would press up against her. She was afraid he might rape her. ASARCO’s HR Department and said there was nothing it could do.  She transferred to another unit.
  • There was no functioning women’s restroom in the building so the company rented a “porta-potty” for Aguilar’s use.  It was vandalized repeatedly with pornographic graffiti directed at her. She reported it to HR and the mill supervisor in 2006 but photos showed that visible pornographic graffiti remained on the toilet in 2007.
  • Another supervisor told Aguilar “your ass is mine” and often gave her conflicting orders, snapping his fingers at her, telling her to watch herself, yelling at her and threatening her with termination.  Needless to say, management did nothing when Aguilar complained. ASARCO maintained in the litigation that the supervisor’s behavior was not motivated by sex but instead by his general boorishness toward everyone.

Aguilar finally quit.

The case, State of Arizona v. ASARCO, was initially filed by Arizona on behalf of Aguilar and the state. Aguilar subsequently filed her own lawsuit.